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Quarter Pounder

By Tim KnightStock MarketsOct 03, 2022 03:18AM ET
www.investing.com/analysis/quarter-pounder-200630562
Quarter Pounder
By Tim Knight   |  Oct 03, 2022 03:18AM ET
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DIA
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EEM
-0.45%
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SPY
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Friday was, neatly, exactly the last day of the quarter, and we kick off the final quarter of this so-far glorious year today. Let’s look at a variety of important ETFs using quarter bars (each bar represents a full three months, instead of the typical single day0 to get a crude, long-term picture as to where the markets stand. 

We begin with commodities which, thank largely to oil and precious metals, has traversed to the bottom of its multi-year ascending channel. What we want to see next here is a break, which I am anticipating will happen thanks to continued weakness in commodities.

DBC Chart
DBC Chart

The Dow peaked at the start of this year, and we’ve been tracking lower in a descending channel. I am anticipating a more substantial drop in the months ahead, resembling what we saw during the financial crisis but, ultimately, even worse.

DJIA Chart
DJIA Chart

Although U.S. markets ultimately peaked early this year, the emerging markets have been in a bear market for a full year and a half so far.

EEM Chart
EEM Chart

Looking at worldwide markets (sans North America), we’ve just finished our third large red bar, echoing, once again, the wipeout around 2008.

EFA Chart
EFA Chart

Asian markets have been weak, with Chinese (by way of FXI) showing persistent weakness, and the old age colony known as Japan is finally succumbing to gravity, in spite of literally quadrillions of yen in “support” being burled at their broken, kabuki theatre “markets.”

EWJ Chart
EWJ Chart

Which brings us to gold. Poor, poor old gold. The so-called inflation fighter, which has been a wretched pig. It has lost a full 20% of its value, defying its “precious” moniker utterly. We are presenting at major support, although I wouldn’t past this rock to break that as well.

GLD Chart
GLD Chart

Looking at the long-term chart of the Nasdaq is truly nauseating. Just take a look at the steady ascent, particularly what was taking place from 2013 to 2019. There’s not a downtick in sight. It’s as if a medium-sized green bar was required by government edict every single quarter for years on end. Anyway, one doesn’t pay for fourteen years of fraud by having a few weak months. This channel is at risk of failure, although there’s no doubt a lot of the froth has been blown off the top of this beer, as the hundreds of 90%+ losers can attest.

QQQ-Chart
QQQ-Chart

The same “a green bar every single quarter” freak show can be witnessed in the S&P 500. My hand to God, I don’t know how I survived.

SPY-Chart
SPY-Chart

Shield your eyes, Frank. It’s time for bonds. As you can plainly see, the demolition of bonds is unprecedented on this chart. Complete devastation, mayhem, and gnashing of teeth. It’s up to the hairless choads at the Fed to see how much longer this bonfire burns.

TLT Chart
TLT Chart

Finally, there are the banks, by way of the XLF fund. The wedge pattern provided a perfect repulsion point, and now we have a completed top. If this top fails, that could set into motion the 2008 scenario immediately.

XLF Chart
XLF Chart

As I enter Q4 2022, I am 100% loaded on the short side with January 2023, March 2023, and even January 2024 puts. Godspeed.

Quarter Pounder
 

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Quarter Pounder

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Comments (2)
Bubba Born
Bubba Born Oct 03, 2022 6:10AM ET
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The way it's going down it's like somebody flushed the toilet more than once!
Jack Hamm
Jack Hamm Oct 03, 2022 4:11AM ET
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currency and bond rate of change very high. Probably nothing.
 
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